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Trump Authorizes Tariffs, Defying Allies at Home and Abroad

March 9, 2018 by  
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As a result of Mr. Trump’s action, levies on imports of steel will rise by 25 percent and aluminum by 10 percent. Business groups have warned that the effect could be felt across the global supply network as consumers face higher prices for automobiles, appliances and other goods. But Mr. Trump’s aides dismissed such predictions as “fake news” and said most Americans would hardly notice any impact.

The United States issued the tariffs under a little-used provision of trade law, which allows the president to take broad action to defend American national security. The Commerce Department previously determined that imports of metals posed a threat to national security.

The United States is the largest steel importer in the world and the order could hit South Korea, China, Japan, Germany, Turkey and Brazil the hardest. Mr. Trump said his tariff orders were tailored to give him the authority to raise or lower levies on a country-by-country basis and add or take countries off the list as he deemed appropriate.

“This has certainly put the fear of God in America’s trading partners,” said Eswar Prasad, a professor of international trade at Cornell University. The tariffs disprove the notion that Congress and broader business interests would prevent the Trump administration from turning its saber-rattling into real sanctions, Mr. Prasad said. “The day has actually come when real trade sanctions are on the board.”

The White House sought to soften the blow by temporarily exempting two key trading partners, Canada and Mexico, and opening the door to carve-outs for other countries. Mr. Trump said the order would temporarily exempt Canada and Mexico, pending discussions with both about the terms of trade, including already tense talks over the North American Free Trade Agreement.

Officials from Canada and Mexico have said they will not be bullied into accepting a Nafta deal that could disadvantage their countries.

Chrystia Freeland, Canada’s foreign minister, called the initial exemption a “step forward” but said it would not change Canada’s negotiating approach to Nafta. In a statement, Mexico said those talks would not be subject to conditions outside the negotiating process.

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In language authorizing the tariffs, the White House said any nation with a security relationship with the United States was welcome to discuss “alternative ways to address the threatened impairment of the national security caused by imports from that country.” Those talks could result in the tariff being lifted, the order said.

Mr. Trump said that Robert Lighthizer, the top United States trade negotiator, would be in charge of negotiating with countries asking for exemptions in the next 15 days.

The potential for exemptions is likely to incite a tsunami of lobbying and cajoling as foreign governments pressure the White House for a carve-out that could save them from steep tariffs.

“We look forward to educating the Trump administration on the vital role the Japanese steel industry plays in the American marketplace,” said Tadaaki Yamaguchi, a steel executive and the chairman of the Japan Steel Information Center. “The Japanese industry is not part of the import problem but a solution.”

Wilbur Ross, the commerce secretary, will lead a parallel process that could result in the exemption of certain products made of steel and aluminum that American companies need, but that are not manufactured domestically. Products as varied as construction cranes and railroad ties are made with specialized steel that is not available widely, if at all, from United States manufacturers.

During a cabinet meeting earlier in the day, Mr. Trump singled out Australia as an example of another country that could be excluded, citing the trade surplus that the United States maintains with Australia, which imports more from America than it exports to the country.

The announced trade barriers came just hours after a group of countries signed the Trans-Pacific Partnership, a sweeping trade deal that no longer includes the United States. Mr. Trump, a fervent opponent of the deal, officially withdrew the United States from it on his fourth day in office.

The juxtaposition further highlighted the protectionist approach to trade policy that Mr. Trump has embraced, bucking years of America’s embrace of free and open trade. Trade experts said the approach would ultimately compromise the United States’ ability to temper China’s unfair trading practices.

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“The tariff action coupled with the mishandled renegotiations of existing trade deals have alienated the very countries we need as allies to help confront the challenges posed by China,” said Daniel M. Price, a former Bush White House adviser.

The tariff announcement was poised to set off a wave of retaliation and suits against the United States at the World Trade Organization, as countries argue that they posed no security threat to the United States.

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Trade lawyers said that, by exempting Canada and Mexico from the process for reasons related to Nafta, the United States might undermine its legal argument for national security and open itself up to further challenges.

They also worried about the ultimate consequences of those trade cases for an international trading system that the United States has worked to construct since the World War II.

If the World Trade Organization rules against the United States, the Trump administration will have to decide whether to reverse its decision or go up against the organization. If the United States ignores or withdraws from the group, it could precipitate a breakdown in global trading rules and a new era of global protectionism.

“It opens up this horrible Pandora’s box, and we don’t know where that leaves other countries or where that leaves the W.T.O.,” said Monica de Bolle, a senior fellow at the Peterson Institute for International Economics.

Mario Draghi, the president of the European Central Bank, said on Thursday that a plan to impose broad tariffs that hit allies was “dangerous” and could undermine national security.

“If you put tariffs against your allies,” Mr. Draghi said at a news conference in Frankfurt, “one wonders who the enemies are.”

More than 100 Republican lawmakers sent a letter to Mr. Trump on Wednesday imploring him to drop plans for sweeping tariffs. A day earlier, Mr. Trump’s chief economic adviser, Gary D. Cohn, announced his resignation after his failure to forestall the president from pursuing tariffs.

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While many economists have said it is natural for a high-technology, highly developed economy like the United States to evolve away from raw industries, Mr. Trump presented the steel and aluminum sectors in romantic terms, signs of a muscular superpower that had been allowed to atrophy under his predecessors.

“Steel is steel,” he said. “You don’t have steel, you don’t have a country.”

He invited a few of the steelworkers to make comments and they told stories of plants that have cut back or idled altogether. “These tariffs going into place, this gives us the ability to come back to 100 percent capacity,” said Dustin Stevens, a worker at Century Aluminum’s plant in Hawesville, Ky.

Century Aluminum has said that it will restart shuttered capacity at its Hawesville plant, adding nearly 300 workers this year. And on Wednesday, United States Steel said it would restart a blast furnace in Granite City, Ill., bringing back 500 workers to help meet additional orders that it expected as a result of the tariffs.

But economists warned of potential job losses from price increases, and other industries that send their products abroad denounced the risk of retaliation.

John Heisdorffer, the president of the American Soybean Association, called the tariffs “a disastrous course of action from the White House” that could put farmers at risk at a time when the agriculture industry is already struggling. “We have heard directly from the Chinese that U.S. soybeans are prime targets for retaliation,” he said. Soybeans are the United States’ biggest agricultural export.

Senator Ben Sasse, Republican of Nebraska, said the United States was “on the verge of a painful and stupid trade war.”

“This isn’t just bad for farmers and ranchers in Nebraska who need to buy a new tractor, it’s also bad for the moms and dads who will lose their manufacturing jobs because fewer people can buy a more expensive product,” he said.

Senator Mitch McConnell of Kentucky, the majority leader, said he and his colleagues “are concerned about the scope of the proposed tariffs on steel and aluminum and their impact on American citizens and businesses, including many I represent in Kentucky.”

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In 2002, President George W. Bush imposed steel tariffs of up to 30 percent. But facing an adverse ruling by the World Trade Organization and retaliation by trading partners, he lifted them 15 months before the end of the planned three-year duration. Studies found that more jobs were lost than saved and Republican leaders vowed not to repeat the experiment.

The Trade Partnership, a research firm cited by pro-trade advocates, has concluded the same would happen with Mr. Trump’s tariffs. It estimated that the tariffs would create 33,464 jobs in the metals sectors but cost 179,334 jobs in other sectors for a net loss of nearly 146,000.

The issue has divided Mr. Trump’s own team. Mr. Ross, Mr. Lighthizer and Peter Navarro, the president’s trade and manufacturing adviser, overcame objections from Mr. Cohn and national security officials like Jim Mattis, the defense secretary, who cautioned Mr. Trump that the plan would roil relations with important security allies.

The consequences of the split were on display at the cabinet meeting earlier in the day when Mr. Trump thanked Mr. Cohn for his service, but needled him about his decision to leave. “He may be a globalist, but I still like him,” the president said as Mr. Cohn sat in a chair along the wall and smiled. “He’s seriously a globalist. There’s no question. You know what? In his own way he’s a nationalist, because he loves his country.”

Mr. Trump then suggested that Mr. Cohn might eventually return to the administration. “I have a feeling you’ll be back,” the president said. In a teasing voice, he added: “I don’t know if I can put him in the same position though. He’s not quite as strong on those tariffs as we want.”


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Trump accepts invitation to meet with North Korean leader Kim Jong Un

March 9, 2018 by  
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President Trump has agreed to meet with North Korean leader Kim Jong Un for talks, an extraordinary development following months of heightened nuclear tension during which the two leaders exchanged frequent military threats and insults.

Kim has also committed to stopping nuclear and missile testing, even during joint military drills in South Korea next month, Chung Eui-yong, the South Korean national security adviser, told reporters at the White House on Thursday night after briefing the president on his four-hour ­dinner meeting with Kim in Pyongyang on Monday.

After a year in which North Korea fired intercontinental ballistic missiles capable of reaching all of the United States and tested what is widely thought to have been a hydrogen bomb, such a moratorium would be welcomed by the United States and the world.

Trump and Kim have spent the past year making belligerent statements about each other, with Trump mocking Kim as “Little Rocket Man” and pledging to ­“totally destroy” North Korea and Kim calling the ­American ­president a “dotard” and a “lunatic” and threatening to send nuclear bombs to Washington, D.C.

But Kim has “expressed his eagerness to meet President Trump as soon as possible,” Chung told reporters.

“President Trump said he would meet Kim Jong Un by May,” Chung said, but he did not provide any information on where the meeting would be. In Seoul, the presidential Blue House clarified that the meeting would occur by the end of May.

The White House confirmed that Trump had accepted Kim’s invitation to meet, which came as a message from Chung rather than in a letter from the North Korean leader.

“President Trump greatly appreciates the nice words of the South Korean delegation and President Moon. He will accept the invitation to meet with Kim Jong Un at a place and time to be determined,” White House press secretary Sarah Huckabee Sanders said in a statement. “We look forward to the denuclearization of North Korea. In the meantime, all sanctions and maximum pressure must remain.”

Trump took to Twitter on Thursday night to laud the announcement. “Great progress being made but sanctions will remain until an agreement is reached. Meeting being planned!” he wrote. 

Any meeting between Trump and Kim would be historic — there has never been a face-to-face negotiation, or even a phone call, between the sitting leaders of North Korea and the United States. Former president Jimmy Carter met Kim’s grandfather Kim Il Sung, and former president Bill Clinton met his father, Kim Jong Il — during visits to Pyongyang after they had left office. Both Carter and Clinton also went to Pyongyang to collect Americans who had been imprisoned by the regime.

Chung led the South Korean delegation earlier this week to North Korea, where Kim and his senior cadre expressed a willingness to hold talks with the United States and were prepared to discuss denuclearization and normalizing relations.

South Korea’s national security advisor Chung Eui-yong (center) and spy chief Suh Hoon (left) head for the plane that would take them to Washington on Thursday to meet with American officials.  (-/AFP/Getty Images)

During the meetings, Kim “made it clear” that the North would not resume provocations while engaged in those talks, Chung said Tuesday upon returning to Seoul.

In front of the White House Thursday night, Chung credited Trump for bringing the North Korean leader to the table, continuing Seoul’s deliberate efforts to flatter the American president.

“I explained to President Trump that his leadership and his maximum-pressure policy, together with international solidarity, brought us to this juncture,” Chung said.

It was an extraordinary scene — a foreign official, unaccompanied by U.S. leaders, briefing the press at the White House about the American president’s plans. Chung was flanked by Suh Hoon, the head of South Korea’s intelligence agency, who was also at the dinner in Pyongyang, and Cho Yoon-jae, the South Korean ambassador to the United States.

A senior administration official said the White House meeting between Trump and the South Korean officials included senior presidential aides, including Defense Secretary Jim Mattis and Chief of Staff John F. Kelly, a retired Marine Corps general. Trump spoke with Japanese Prime Minister Shinzo Abe after the meeting, the official said.

Trump emphasized during the meeting that the severe economic sanctions his administration and the United Nations have levied on North Korea over the past year must remain in place.

“President Trump has been very clear from the beginning, he is not prepared to reward North Korea in exchange for talks,” the official, who was not authorized to speak on the record, told reporters in a background briefing organized by the White House. “But he is willing to accept the invitation at this time to meet . . . and he expects North Korea to start putting action to the words they conveyed.”

The official said that the administration would require “verification” of the North’s dismantling of its nuclear program if an agreement is reached between the countries. “We will settle for nothing less than that outcome,” the official said.

Asked why the administration did not seek to establish lower-level talks as a prerequisite to a presidential summit, the official said lower-level engagement has taken place for 27 years, and “that history speaks for itself.”

“President Trump has a reputation for making deals,” the official added. “Kim Jong Un is the one person able to make decisions in their uniquely totalitarian system, and so it made sense to accept the invitation with the one person who can make decisions instead of repeating the long slog of the past.”

Some analysts agreed with the administration that Kim is suddenly interested in talks because the sanctions are beginning to hurt and because he is genuinely afraid of U.S. military strikes.

But others say that he’s feeling more confident than ever. In November, Kim declared that he had “completed” his missile program and is now ready to deal with the United States — on an equal footing, nuclear state to nuclear state.

The invitation was the result of Kim’s “broad-minded and resolute decision” to contribute to the peace and security of the Korean Peninsula, said North Korea’s ambassador to the United Nations in New York, who is responsible for handling communications with the United States.

By the “great courageous decision of our Supreme Leader, we can take the new aspect to secure the peace and stability in the Korean Peninsula and the East Asia region,” Pak Song Il wrote in an email to The Washington Post.

The decision to hold the meeting was consistent with North Korea’s principle that the issues should be solved through negotiation, Pak said.

“The United States should know and understand our position and should further contribute to the peace and security-building in the Korean Peninsula with [a] sincere position and serious attitude,” he wrote.

A meeting would be a huge step between the two countries, avowed enemies for 70 years, and particularly between two leaders.

However, Trump has also repeatedly said he would be willing to talk to Kim. While running for president in 2016, Trump said he wouldn’t host Kim for a state visit but would be happy to sit down for hamburgers at a boardroom table with the North Korean leader.

The North Koreans have been confused by Trump’s un­or­tho­dox leadership style, making contact with analysts in Washington with Republican ties. Senior North Korean officials have even read “Fire and Fury,” the explosive book by Michael Wolff about Trump’s White House.

There was no immediate word on where a meeting would be held, although it would be unprecedented if it took place outside the Korean Peninsula.

Since he took over the leadership of North Korea from his father at the end of 2011, Kim has not met any other head of state. Discussions are now underway to hold a summit with South Korean President Moon Jae-in in the demilitarized zone between the two Koreas at the end of next month.

Kim sent his sister, Kim Yo Jong, to South Korea at the opening of the Winter Olympics last month to deliver an invitation to Moon for a summit. Preparations are underway for that meeting, set for the end of April, even as the United States and South Korea prepare to begin drills that anger North Korea every year.

There has been no word on the three American men who have been detained in North Korea, one for 2½ years. North Korea has been treating them as prisoners of war and has denied Swedish diplomats, representing the United States in North Korea, consular access to them since June last year.

Fifield reported from Tokyo. Anne Gearan, Ashley Parker, Seung Min Kim and David Nakamura in Washington contributed to this report.

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